Field Underwriting Guide

Transcription

1 LIFE INSURANCE Field Underwriting Guide APRIL 16, 2018 Replaces the version dated JULY 21, 2017 Age and Amount Requirements Preferred Class Criteria Financial and Nonmedical Guidelines Policies issued by: American General Life Insurance Company (AGL) and The United States Life Insurance Company in the City of New York (US Life) FOR FINANCIAL PROFESSIONAL USE ONLY- NOT FOR PUBLIC DISTRIBUTION 1

2 NOW ADAPTED FOR USE BY: Brokerage ISG AIG Direct Partners Group Financial Network What s New in this Field Underwriting Guide Expanded Non Medical Program for Certain Permanent Products and Face Amounts Streamlined Competitive Underwriting Programs Opioid Use Policy This guide is just that a guide. We will always view applicants as a whole meaning we will consider other factors such as finance, profession and background. We won t rely solely on medical history when making an underwriting decision. We will also practice a debit/credit approach, because we know that even though someone may have a health issue, favorable factors can help reduce the extra risk associated with it. We have the utmost respect for the agent/client relationship and are committed to underwriting practices that strengthen that relationship. We know you have choices when deciding where to place your business, so we believe earning your business requires differentiating ourselves through the service and treatment we deliver to every producer and client. We are committed to: Attracting and retaining well-trained medical and underwriting professionals Consistently updating our underwriting guidelines to reflect medical advancements Continually monitoring mortality trends Updating our debit/credit system to acknowledge favorable factors such as family history, lipids, EKG, recent testing and smoking status Embracing and adopting emerging technologies, submission methods and communication tools to improve customer and agent experience NOTE: The information contained within this Field Underwriting Guide may be updated at any time throughout the year. To view the most current version of this guide, please refer to the electronic document published on our website at: estation.americangeneral.com. The charts on the following pages represent underwriting requirements for American General Life Insurance Company and The United States Life Insurance Company in the City of New York. Each company has the right to order any additional requirements deemed necessary to properly evaluate risk, regardless of age or amount. 2

3 CONTENTS PAGE What s New in this Field Underwriting Guide...2 Age and Amount Requirements Term Products...4 Age and Amount Requirements Permanent Products...5 Preferred Underwriting Class Guidelines...6 Select Height/Weight Chart...7 Competitive Underwriting Programs...8 Lab Scoring...8 Attending Physician Statement(APS) ordering guidelines...9 Impairments Requiring an APS...9 Expiration of Underwriting Requirements...9 Selected Nonmedical Risks...10 Motor Vehicle...10 Aviation...10 Foreign Residence and Travel...10 Criminal Activity...10 Scuba...11 Military...11 General Financial Underwriting Guidelines Personal Insurance...12 Non Working Spouse Guidelines...12 Juveniles...12 Business Insurance...13 Bankruptcy...13 Retention and Reinsurance Limits...14 Cigar Smokers...14 Marijuana Use Opioid Use

4 Age 1 and Amount Underwriting Requirements 2 TERM PRODUCTS ONLY Not all products are available at all ages, amounts or rate classes. Consult product guides for availability. Face Amount AGES ** 50,000 to 99,999+* VCPB++, VCPB++, VCPB++, VCPB++, VCPB++, AC, $100,000 to 249,999 PM, B/U,, AC FT, EKG,, 71IR, AC $250,000 PM,B/U 4,, AC FT, EKG,, 71IR, AC, ES $250,001 to $500,000, AC FT, EKG,, 71IR, AC, ES $500,001 to 1 million FQ,, AC FT, EKG,, FQ, 71IR, AC, ES $1,000,001 to 1.5 million, FQ, AC FT, EKG,, FQ, 71IR, AC, ES $1,500,001 to 3 million 3 CR, CR, CR, CR, CR, CR, CR,, FQ, AC MD or FT, EKG,, FQ, 71IR, AC, ES $3,000,001 to 5 million, FQ, ES, FQ, ES, FQ, ES, FQ, ES, FQ, ES, FQ, ES, FQ, TPF, AC, ES MD, B/U 4, FT, EKG,, FQ,TPF, 71IR, AC, ES $5,000,001 to $10 million, FQ,, FQ,, FQ,, FQ,, FQ, TPF,, FQ, TPF,, FQ,TPF, AC, MD, B/U 4, FT, EKG,, FQ, TPF, 71IR, AC, Greater than $10 million EKG, IR,, FQ, TPF, EKG, IR,, FQ, TPF, EKG, IR,, FQ, TPF, EKG, IR,, FQ, TPF, EKG, IR,, FQ, TPF, EKG, IR,, FQ, TPF, EKG, IR,, FQ, TPF, AC, MD, B/U 4, FT, EKG,, FQ, TPF,71IR, AC, * Non-medical underwriting available only to U.S. citizens or permanent resident green-card holders. **71+ amounts over our retention require MD Exam. See page 14 + Total inforce and applied with AIG in the last 12 months must be within this range. ++ Medical records generally will not be used to evaluate these risks. Applications requiring medical records will be deferred to other plans or higher amounts for full medical underwriting. A HIPAA authorization is required for all ages and amounts. Face amount is based on the total amount of coverage issued and placed in-force by AGL and US Life within the past 12 months. Street inspection interviews are completed for ages 18-70, over $25 million. 1 Use age nearest 2 Home Office may order additional database checks. (This may include an Rx Database Check, property verification, Internet report, MIB, or other research deemed necessary by the Home Office Underwriting Department.) 3 Inspection Report required for any non-resident alien living outside the United States applying for more than $1,500, Lab testing includes NT pro-bnp at these ages and amounts. AC Agent Certification form B/U Full blood profile and urinalysis CR* Credit Report EKG Resting EKG ES* Electronic Records Search FQ Financial questionnaire FT Functional Tests conducted with PM/MD. These include a gait test to assess the applicant s ability to walk at a normal pace and a test to assess the applicant s ability to rise from a seated position unassisted. IC Individual consideration IR* Inspection report MD Exam by physician * Motor vehicle report NM Nonmedical (agent-completed Part B) PM Paramedical exam to include height/weight, blood pressure and pulse TPF Third-party financials provided by CPA with first-hand knowledge of client s finances (examples include: Statement of Assets and Liabilities; Profit and Loss Statement; Cash Flow Statement;Balance Sheet) TT* Tax Transcript (Client must provide Request for Transcript of Tax Return, form 4506T-EZ, find on Forms Depot) VCPB Agent-Completed Part A and a Vendor-Completed Part B non-medical interview required 71IR* Expanded Inspection Report to include Cognitive Tests. The EMST portion is an enhanced mental skills test that helps assess the applicant s cognitive skills. This test takes approximately 15 minutes. *Home Office-ordered requirement 4 USE THIS TABLE FOR TERM PRODUCTS ONLY

5 Age 1 and Amount Underwriting Requirements 2 PERMANENT PRODUCTS ONLY Chronic Illness Rider: see footnote 3 below, and details on page 8. Face Amount AGES , ** NON-MED UNDERWRITTEN up to $499,999+ (Available only to U.S. citizens or permanent resident green-card holders) Max Accumulator+, QoL Max Accumulator+, AG Platinum Choice VUL 2 >$499,999 See Fully Underwritten below NM++ or VCPB++ VCPB++, VCPB++, VCPB++, VCPB++, =Age 50 VCPB++, >Age 50 see Fully Underwritten below See Fully Underwritten below See Fully Underwritten below See Fully Underwritten below FULLY UNDERWRITTEN - UL, SUL, VUL, IUL, Whole Life Products $50,000 to $249,999 NM NM,, AC FT, EKG,, 71IR, AC $250,000 NM NM,, AC FT, EKG,, 71IR, AC $250,001 to $500,000 NM NM,, AC FT, EKG,, 71IR, AC, ES $500,001 to $1 million $1,000,001 to $1.5 million $1,500,001 to $3 million 5 $3,000,001 to $5 million $5,000,001 to $10 million IC, FQ IC, FQ IC, FQ IC, FQ IC, FQ, TPF Greater than IC, FQ, $10 million 3 TPF IC,, FQ IC,, FQ IC,, FQ IC,, FQ IC,, FQ, TPF IC,, FQ, TPF, FQ, ES, FQ, EKG, IR,, FQ, TPF,, FQ, ES, FQ, EKG, IR,, FQ, TPF, + Total inforce and applied with AIG in the last 12 months must be within this range. ++ Medical records generally will not be used to evaluate these risks., FQ, ES, FQ, EKG, IR,, FQ, TPF, * Survivorship Plans - use full amount applied for each life. If one life is uninsurable, that applicant will only need an application Part A, an agent-completed Part B and an APS. ** 71+ amounts over our retention require MD Exam. See page 14 Applications requiring medical records will be deferred to other plans or higher amounts for full medical underwriting. A HIPAA authorization is required for all ages and amounts. Face amount is based on the total amount of coverage issued and placed in-force by AGL and US Life within the past 12 months. Street inspection interviews are completed for ages 18-70, over $25 million. 1 Use age nearest 2 Additional database checks may be ordered from the Home Office. (This may include an Rx Database Check, property verification, Internet report, MIB, or other research deemed necessary by the Home Office Underwriting Department.) 3 Accelerated Access Solution (Chronic Illness) Rider: if applied, 71IR required for age 61and up. 4 Maximum retention over age 80: $4,000,000 5 Inspection Report required for any non-resident alien living outside the United States applying for more than $1,500, Lab testing includes NT pro-bnp at these ages and amounts., FQ, ES, FQ, EKG, IR,, FQ, TPF,, AC, FQ, AC, FQ, AC, FQ, ES, FQ, TPF, 3 AC, ES 3, FQ, TPF, ES 3, TT PM,B/U 6, EKG, IR 3,, FQ, TPF,, FQ,TPF, AC, ES 3, TT EKG, IR 3,, FQ, TPF, AC, FT, EKG,, 71IR, AC, ES FT, EKG,, FQ, 71IR, AC, ES FT, EKG,, FQ, 71IR, AC, ES PM, B/U6, FT, EKG,, FQ,TPF, 71IR, AC, ES MD or PM 4, B/U 6, FT, EKG,, FQ, TPF, 71IR, AC, MD 4, B/U 6, FT, EKG,, FQ, TPF, 71IR, AC, AC Agent Certification form B/U Full blood profile and urinalysis EKG Resting EKG ES* Electronic Records Search FQ Financial questionnaire FT Functional Tests conducted with PM/MD. These include a gait test to assess the applicant s ability to walk at a normal pace and a test to assess the applicant s ability to rise from a seated position unassisted. IC Individual consideration IR* Inspection report MD Exam by physician * Motor vehicle report NM Nonmedical(agent-complete Part B) PM Paramedical exam to include height, weight, blood pressure and pulse TPF Third-party financials provided by CPA with first-hand knowledge of client s finances (examples include: Statement of Assets and Liabilities; Profit and Loss Statement; Cash Flow Statement;Balance Sheet) TT* Tax Transcript (Client must provide Request for Transcript of Tax Return, form 4506T-EZ on Forms Depot) VCPB Agent-Completed Part A and a Vendor-Completed Part B non-medical interview required 71IR* Expanded Inspection Report to include Cognitive Tests. The EMST portion is an enhanced mental skills test that helps assess the applicant s cognitive skills. This test takes approximately 15 minutes. * Home Office-ordered requirement USE THIS TABLE FOR PERMANENT PRODUCTS ONLY 5

6 Preferred Underwriting Class Guidelines for Term, UL, WL, VUL Preferred Plus Preferred Nontobacco Standard Plus 1 (Term only) Preferred Tobacco Lab scoring Used for rate class evaluation; see page 8 for additional details No tobacco (years) Aviation or hazardous avocation No No Yes 2 No Cholesterol/HDL ratio, total cholesterol If ratio <5.0, 215 If ratio <4.5, 300 If ratio <6.0, 245 If ratio <5.5, 300 If ratio <7.0, 260 If ratio <6.5, 300 If ratio <6.0, 245 If ratio <5.5, 300 Blood pressure TERM: 0-60: 135/85 61+: 140/85 PERMANENT: 0-60: 140/85 61+: 150/85 Blood Pressure Treatment OK 3 TERM: 0-60: 140/85 61+: 150/85 PERMANENT: 0-60: 145/88 61+: 155/88 Blood Pressure Treatment OK TERM & PERMANENT: 0-60: 145/88 61+:155/88 Blood Pressure Treatment OK TERM: 0-60: 140/85 61+: 150/85 PERMANENT: 60: 145/88 61+: 155/88 Blood Pressure Treatment OK Build See current select height/weight chart No DUI, reckless, revocation, suspension/7 years No DUI, reckless, revocation, suspension/6 years No DUI, reckless, revocation, suspension/5 years No DUI, reckless, revocation, suspension/6 years Family History No coronary artery disease or cancer prior to age 60 (parents only). No death due to coronary artery disease or cancer prior to age 60 (parents only). One coronary artery disease or cancer death prior to age 60 (parents only). No death due to coronary artery disease or cancer prior to age 60 (parents only). Ignore family history for PI age 65 and gender-specific cancers at all ages. Disregard family history that is adopted or unknown; disregard cervical and non-melanoma skin cancer. Standard is the best class available for amounts below $100,000. Personal history Cases assessed at Standard or +0 without the use of credits are generally eligible for preferred consideration. No medical flat-extra premium, no debits for build, cholesterol or blood pressure or other medical impairment. Disregard history of non-melanoma skin cancer, cervical, stage I seminoma, papillary thyroid cancer and remote history of melanoma in situ. 1 Where applicable by plan and state approval. If Standard Plus is not available for the plan, the client must meet PNT guidelines to qualify for better than Standard rates. 2 Will be considered with appropriate rating. 3 With evidence of blood pressure control in the Preferred Plus range for six months or more. * A rating may apply due to overall driving history. 6

7 Select Height/Weight Charts for Term, UL, WL, VUL MALE Height Preferred Plus* Preferred NT Preferred T Standard Plus* Feet In Low High Low High Low High FEMALE Height Preferred Plus* Preferred NT Preferred T Standard Plus* Feet In Low High Low High Low High * Where applicable by plan and state approval. 7

8 Competitive Underwriting Programs These programs allow underwriters to take certain Preferred or rated classes and improve them in situations where an applicant wouldn t normally qualify for a better class. These competitive programs are reviewed by the underwriter on each application, therefore, no special request is needed. Here is a brief summary of each of these underwriting programs: Preferred Credits Available on all products, applicant ages Ability to improve or offset one preferred class for unfavorable build, family history, or cholesterol Healthy Credits Available on all products, applicants ages Ability to improve one preferred class or one table rating for medical impairments only Based on qualifying for four or more healthy factors reviewed by underwriting in the labs and/or medical records Better Choice Preferred Available on all products and all ages Clients may receive a better choice by being considered for Preferred class rather than Standard on certain medical impairments that were previously no better than Standard Expanded Standard Available on permanent products (where state approved), applicants age Allows product pricing to encompass Table 1 and 2 under the Standard class Questions about these programs may be directed to your Underwriting Team. Lab Scoring AGL and US Life use a lab scoring methodology to determine preferred rate classes for Term applications, and overall acceptability. Applicants with favorable lab scoring results, in addition to our established preferred criteria, are eligible to receive our best offers. The vast majority of applicants who previously met Preferred Plus, Preferred Non Tobacco, Standard Plus, or Preferred Tobacco rate class criteria continue to do so. Accelerated Access Solution (AAS) Chronic Illness Rider Currently available only on certain permanent plans, and is only available at issue; cannot be added to coverage at time of conversion (see product specific documents for complete details) Chronic Illness Supplemental Application required at the time of application (available on Forms Depot) 71+IR required for all amounts, ages 61 and older, when this rider is requested. This inspection report must be ordered from the home office and includes an EMST (Enhanced Mental Skills Test) Rider coverage is not available: If rated Table E or higher, or If rated with medical or non-medical flat extras, or With a history of certain other impairments, see the stand alone Accelerated Access Solution (Chronic Illness) Rider agent documents for more details. Trust Certificate A Certificate of Trust (form AGLC2239COT) must be submitted prior to underwriting approval whenever a trust is listed as policy owner. An Acknowledgement and Release Form (form AGLC 2239AR) is required whenever an agent is named as trustee. 8

9 Attending Physician Statement (APS) ordering guidelines A routine physical exam (PE) APS should be ordered in these circumstances: AGE AND AMOUNT APS ORDERING GUIDELINES * AGE Face Amount 6-17 Exceeds $3,500,000 and PE within 5 years Exceeds $2 million and PE within 2 years Exceeds $3,500,000 and PE within 5 years Exceeds $1,500,000 and PE within 3 years Exceeds $3,500,000 and PE within 5 years All amounts & PE within 5 yrs + See older age guidelines below All amounts & PE within 2 yrs + See older age guidelines below 81+ All amounts & PE within 1 yr + See older age guidelines below AGE + Older Age Guidelines Standard if no complete PE within 2 years Decline if no complete PE within 2 years 81+ Decline if no complete PE within 1 year; Preferred Plus not available over age 80 A complete physical exam (PE), for ages 60 and up, is defined as a full exam with a personal physician, including a history, physical and labs. A brief blood pressure check or prescription refill would not satisfy this definition. Impairments Requiring an APS Abnormal cardiac test (or other abnormal testing) Alcohol or drug treatment* Aneurysm Arrhythmia (significant) Barrett s Esophagus Cancer or Tumor (not Basal Cell or Squamous Cell) Colon polyps removed in the past 12 months Cardiomyopathy Cerebrovascular Disease Connective Tissue Disorder Coagulation Disorder Congenital Heart Disease Coronary Artery Disease Crohn s Disease* Diabetes Eating Disorder GI Hemorrhage Heart Murmur (significant) Hypertension (3 or more HTN meds taken or under age 30) Kidney Disorder (significant) Liver Disorder Lymph Node Disorder Medicinal Marijuana (assessment will be based on disorder requiring this therapy) Multiple Sclerosis Muscular Dystrophy Obesity (rated Table D or greater) Pancreatic Disorder Parkinson s Disease PSA Abnormality Psychiatric Illness (significant) Respiratory Disorder (significant) Not mild asthma* Rheumatoid Disorders including Rheumatoid Arthritis and Lupus* Seizure Disorder* Sleep Apnea* Stroke or TIA Suicide Attempt Syncope Ulcerative Colitis (and similar disorders)* Additional situations where an APS is needed: Any impairment that s rated Table D or greater Recent consultation for someone who has no pattern of regular medical care, but has consulted a physician in the last 90 days This list of impairments covers only some of the more common disorders seen, but does not limit the ordering of an APS for situations of concern that the underwriter might identify. * The underwriter may elect to use a Personal Health Interview (PHI) initially, in lieu of ordering an APS in certain circumstances regular Expiration of Underwriting Requirements Paperwork and exams are only valid for a limited period of time. Below are guidelines for acceptable age of underwriting requirements. TEST AGE 0-70 AGE 71+ Application 1 year 1 year Exam 1 year 6 months Blood and urine 1 year 6 months EKG, inspection, 1 year 1 year 71+ inspection, cognitive test 1 year 1 year Functional test NA 6 months 9

10 Health Statement & Selected Nonmedical Risks Health Statement Underwriting reserves the right to request more information. A health statement is required for: Ages 0 70 when the exam is within 2 weeks of 90 days, or older Ages 71+ when the exam is within 2 weeks of 60 days, or older Withdrawn or incompleted case that s re-opened, regardless of the age of the exam A face amount increase requested after the initial review, regardless of the age of the exam Selected Nonmedical Risks Following are guidelines for a few of the most common nonmedical underwriting topics for which agents seek advice. Note: When in doubt, or the topic is not on this list, send a quote request to our QuickQuote desk. Motor Vehicle High risk circumstances: DUIs - two or more in last 5 years, decline More than 3 moving violations in the last 3 years, no DUI history add $2.50 per $1,000 or more More than 3 moving violations in the last 3 years, with single DUI history, age 35 and up add $3.50 per $1,000 or more, decline if over age 65 Single DUI > 3 years ago, no other violations, possible standard (with no other related history) Single DUI > 7 years ago, no other violations, possible preferred plus (with no other related history) Aviation Common circumstances (also see Underwriting Class Guidelines section). Pilots for major airlines flying in the US and Canada only and no other aviation exposure Preferred Plus Other aviation Aviation Exclusion Rider (AER) will apply if driving history is rated Corporate pilots plane is company-owned, maintained at same standards as commercial aircraft, pilot with ATR or commercial license with IFR, flying in US and Canada only Preferred Plus Private pilots (flying in US and Canada ONLY) Students pilots, at best Standard Plus with additional $3.50 per $1,000 Licensed pilots with over 100 hours solo hours Standard Plus Flying more than 200 hours per year likely $2.50 per $1,000 Flying into Mexico $2.50 per $1,000 Flying other than in the US or Canada (including Bermuda or Bahamas) or Mexico AER, or IC with facultative reinsurance Best rates with an AER: Within our retention: 3 Best rates otherwise qualified Over our retention: 3 Permanent plans, STD+ (Standard NT if STD+ not available) 3 Term plans, STD+ Foreign Residence and Travel This is a constantly changing topic and is not applicable in all states. For our current guidelines, check our website at: estation.americangeneral.com Criminal Activity Applicants who are in jail, awaiting trial, or who are out on probation or parole are postponed until out of jail and off probation or parole for at least 12 months. Misdemeanors (e.g. disorderly conduct, shoplifting) and white collar felonies (tax evasion, political graft) 1 or 2 convictions Off probation > 12 months; best class if otherwise qualified > 2 convictions Individual consideration If > 2 within last 5 years, consider decline Single felonies (e.g. grand theft, larceny, assault, involuntary manslaughter) Off probation: 1 5 years standard with $2.50 per $1,000 extra Off probation: 5 7 years standard Off probation: 7+ yrs better than standard if otherwise qualified Multiple felonies or major felonies (e.g. murder, rape, organized crime, espionage, terrorist acts, possession with intent to deliver, traffic or manufacture drugs) convicted at any time, UNLESS overturned decline 10

11 Selected Nonmedical Risks, Continued Scuba See Underwriting Class Guidelines section Applicants who are recreational SCUBA divers are eligible for our best class (Preferred Plus) if all the following guidelines are met: Applicant dives to depths not exceeding 100 feet Participates in no more than 10 dives per year Dives must be in open water; applicant does not participate in wreck, salvage, cave or under-ice diving (penetration diving) Applicant is PADI, NAUI, or SSI certified or all dives are done with divemaster or instructor Otherwise If over 100 feet, likely $2.50 per $1,000 No exclusion rider available Military All applications must comply with the NAIC regulations regarding military applicants, per procedures published by AIG Member Life Insurers. Active military personnel It is acceptable for agents to write active military personnel No government allotment for initial submissions Total line must meet income replacement guidelines The applicant can have an alert or orders for overseas duty as long as not to a hot spot (if the applicant cannot disclose location, the case cannot be written) (not applicable in all states) No Special Forces, Rangers, SEALS, Marine Force Recon, Marine Raiders, Delta Force, Air Force Para Rescue (PJs) other similar units Military pilots may be rated and we will not consider for better with an AER 11

12 General Financial Underwriting Guidelines PERSONAL INSURANCE Personal Insurance The Financial Underwriting section of this guide is intended to provide you with a basic overview of the most common financial situations and the methods used for calculating a justified amount of coverage. AGE INCOME REPLACEMENT* Multiply Earned Income by <40** Individual Consideration * Income multiples for personal insurance are guidelines only. Consider the income multiple for each age range as the maximum amount for which an individual might qualify. The maximum income factor may not be appropriate for all applicants in a particular age range. **Special consideration for an additional amount given to clients with special established occupations where income is expected to increase substantially Non-Working Spouse, age 59 or less: Use household income to justify coverage through $1,500,000, using income replacement multiples. Amounts over $1,500,000 will be individually considered based on estate planning needs. Non-Working Spouse, age If household income is less than $25,000, we will allow up to 10 times the income of the working spouse. Non-Working Spouse, over age 65: The amount of coverage must be justified using estate planning needs. Secondary Earner, age 59 or less: We will match the coverage available for the secondary earner (spouse with lower earned income) to that applied and qualified for the primary earner (up to $1,500,000) Additional Personal Insurance Notes Note: all amounts referenced are total line (in force and applied). Additional amounts may be considered if justified. Estate Conservation need is based on the taxable value of the estate. Provide estate conservation analysis with the application. Maximum allowable growth rate is 6 percent up to a maximum limit of double the current gross estate. Final Expense coverage will be considered for a maximum of $50,000 when limited financial justification is demonstrated. This amount includes total line with all carriers. If no financial justification is demonstrated, no coverage will be issued. Juveniles: Juveniles are defined as clients age 0 to 17. Financial Requirements: Face amounts $0-$500,000 (amounts requiring only a Non-Med Part B*) At least one parent(s)/guardian will need to have the same amount being requested (unless state specific statutes apply). If the other parent does not have any coverage inforce, or has coverage inforce at a lesser amount than the coverage being requested for the juvenile, the agent will need to provide a cover letter detailing the circumstances surrounding the reason for 1) either the lack of any coverage inforce, or 2) coverage inforce at an amount less than the amount being requested for the juvenile (unless one is uncovered due to un-insurability - contact your home office underwriter to discuss first) All siblings require equal amounts of coverage Face amounts over $500,000 Individual consideration (contact your home office underwriter to discuss first) * An APS and/or inspection may be ordered for cause. Other requirements may be necessary based upon the underwriter s judgment. 12

13 General Financial Underwriting Guidelines BUSINESS INSURANCE BANKRUPTCY Business Insurance (Financial Questionnaire required for all Business Insurance applications) Key Person Coverage financially protects the company from adverse financial impact if a key employee suddenly dies. The policy would provide funds to find, recruit and train a replacement, help replace any lost profits, and strengthen the balance sheet to assure creditors the business will continue. Maximum of 10 times total compensation. In some circumstances (e.g., age, time to retirement, industry and location, etc.), 3 to 5 times compensation will be considered as an appropriate maximum. Buy-Sell/Business Succession/Business Continuation Coverage is limited to the market value of the proposed insured s portion of the business as detailed in the Buy-Out or Buy-Sell agreement, or third party financials. Business Loan Coverage Minimum 5 years remaining on the loan, coverage limited to 75 percent of loan, prorated per each owner s percent share of the business. Business will be the owner and beneficiary with collateral assignment to the debtor. Venture capital is limited to 50 percent coverage, prorated as above. Accidental Death Benefit A maximum of $250,000 per life subject to filed plan limitations. See each plan for details. Waiver Of Premium A maximum of $5,000,000 per life subject to filed plan limitations. See each plan for details. Bankruptcy Credit report required on all cases over age 59 or over $1,500,000; Tax Return Transcript may be required as well at the discretion of the underwriter Term Insurance - Chapters 7, 11, 12, 13 Single Bankruptcy: We will not consider coverage until the bankruptcy has been discharged for at least 24 months (2 years), and financial data supports the total line of coverage to be in force. Multiple Bankruptcies: We will not consider coverage until the most recent bankruptcy has been discharged for at least 60 months (5 years), and financial data supports the total line of coverage to be in force. Permanent Insurance - Chapter 7 We can consider coverage immediately upon discharge of the bankruptcy: If the discharge was less than 12 months ago, the proposed insured must be employed full time and provide us with a current pay stub (or tax return) that documents an income appropriate for the amount of coverage in force and applied. For applicants that have had a Chapter 7 bankruptcy discharged more than 12 months ago, no current pay stub or tax return is required in most cases, however, financial justification for the amounts in force and applied will be required. Permanent Insurance - Chapters 11, 12, 13 We will consider permanent insurance coverage for applicants currently in Chapter 11, 12, or 13 bankruptcy once the applicant is making regular debt payments and financial data supports the total line of coverage to be in-force. Note that we will reduce the amount of income we consider the applicant to make by the amount of the debt payment made, as per court direction. Copies of court papers directing repayment will be required for amounts of $5 million and up. Permanent Insurance Multiple Bankruptcies No offer until discharged from last bankruptcy for at least 24 months and financial data supports the total line of coverage to be in-force. 13

14 General Financial Underwriting Guidelines OTHER CONSIDERATIONS Retention and Reinsurance Limits RETENTION AGES TERM TO TABLE D PERM TO TABLE D 0 70 $3,500,000 $10,000, $2,000,000* $6,000, n/a $4,000,000** 90+ n/a n/a AUTOMATIC LIMIT TERM PERM Ages 0 70 $41,000,000 $60,000, $15,500,000* $30,000, $10,500,000* $30,000, n/a $15,000,000** n/a $5,000,000** 90+ n/a n/a * Must be Table D or better ** Must be Standard or better for individual coverage Cigar Smokers ** This policy will apply only to occasional cigar users and not other forms of tobacco. Based on current mortality information, underwriting will consider cigar use a non-factor in the risk evaluation process if: 1) The use is admitted at the time of application/inquiry and all case data coincides with the admitted degree of usage; and 2) No more than one cigar per week; and 3) No nicotine metabolites (cotinine) are present in the urinalysis done for AGL/US Life or any other company within the past 12 months; and 4) There is no use of tobacco products other than occasional cigars for at least 5 years prior to the time of application or inquiry. Tobacco Use A Tobacco user is considered to be anyone who has used tobacco in any form in the last 12 months. This includes: Cigarettes Cigars - Only limited cigar usage may be considered for nontobacco rates. (See Cigar Smokers ) Pipes Smokeless tobacco Chewing tobacco / Snuff Nicotine substitutes, including patches and gum Electronic (smokeless) cigarettes Vaping Marijuana Use No more than twice per year: Best Class if otherwise qualified Up to twice a month: Standard Non Tobacco rates More often: Tobacco rates, and may be rated Table B or higher Daily use: decline Medicinal use: APS required (decision will be based on history requiring this prescription) Opioid Use In light of the opioid epidemic currently being experienced in the United States, AIG has toughened its underwriting position and will be very conservative when reviewing cases involving ongoing use of prescription or non-prescription opioid medications. 14

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16 Need a complex quote? See the American General Life Underwriter Tool on estation Policies issued by American General Life Insurance Company (AGL) except in New York, where issued United States Life Insurance Company in the City of New York (US Life). Issuing companies AGL and US Life are responsible for financial obligations of insurance products and are members of American International Group, Inc. (AIG). Products may not be available in all states and product features may vary by state. Guarantees are backed by the claims-paying ability of the issuing insurance company AIG. All rights reserved. FOR FINANCIAL PROFESSIONAL USE ONLY NOT FOR PUBLIC DISTRIBUTION AGLC REV0518 ML